Business groups back proposed ‘anti-Ali Baba’ law

 

Business associations have complained that local entrepreneurs cannot set up shop because space is taken by illegal foreign traders. (Bernama pic)

PETALING JAYA: Business groups have voiced strong support for the proposed “anti-Ali Baba” legislation as a measure to prevent business owners from giving licences to migrant workers.

Ameer Ali Mydin, president of the Bumiputera Retailers Organisation, said the law would address the issue of limited space for locals to establish small businesses, particularly in popular areas like Masjid India and Chow Kit.

“New entrepreneurs who want to go and start their business… cannot do so because (these places are) now taken up by foreigners. There’s no space for them,” he told FMT.

“To build up our local entrepreneurs, we need space to do business.”

However, Ameer said there must be strict enforcement or the law would be rendered ineffective, citing fines for illegal parking as an example that people disregard due to lenient penalties.

On Dec 24, economy minister Rafizi Ramli said the proposed “anti-Ali Baba” legislation to end rent-seeking practices could be used against business owners who abuse their licences, which had led to an influx of foreign-controlled establishments in the city centre.

“Ali Baba” is a term originally coined from Bumiputera companies winning government contracts, then subcontracting the actual work to non-Bumiputera companies.

More recently, it has been used to describe business owners renting their operating licences to foreign nationals.

Malaysian Federation of Malay Hawkers and Petty Traders Association information chief Mohamad Abdullah also backed Rafizi, saying that new legislation could stop locals from relinquishing opportunities meant for the younger generation.

“Instead of them having to resort to ride-hailing services like Grab, why not give (the licences) to them (youngsters)? Why allow foreigners to engage in (petty) business activities?” he asked.

“Why not help the youngsters who have the potential to become small-scale entrepreneurs? They will contribute to the development of the Malaysian economy.”

Economic advances of allowing foreigners to run businesses

However, Geoffrey Williams of the Malaysia University of Science and Technology said foreigners should be allowed to operate in sectors for which Malaysians show little interest, such as retail and food stalls.

“It adds impact by creating cheap outlets for consumers, for which there is a demand. It also creates impact by keeping areas economically active,” he said.

Adding that the core issue lies in “Ali Babas” selling or renting licences to foreigners, Williams also suggested removing the associated subsidies.

“Without subsidies, the business licences would not be attractive to anyone. The problem would solve itself and go away,” he said. - FMT